Thursday, June 15, 2017

Ag Futures: "Spring wheat is losing its grip"

From Agrimoney:

Spring wheat is
losing its grip.

That is, its grip on other grain markets, with a soft start
to Minneapolis wheat futures not reflected so much in Chicago.

Minneapolis spring wheat for July shed 1.3% to $6.19 ½ a bushel
as of 09:15 UK time (03:15 Chicago time), undermined by recent rains which have
eased, somewhat, fears over drought damage to the crop in the northern US
Plains.

"The market remains overbought. There have been beneficial
rains," said Benson Quinn Commodities, forecasting that Minneapolis futures
will "drop back to gap [in the chart] left on Monday night".

That would mean a retreat to $6.06 a bushel.

'Production prospects
remain high'

But what benefit have the rains actually brought to northern
Plains spring wheat crops, some of which have, after all, already been cut for
hay by farmers desperate to salvage something, or are too far gone in
development for moisture to have much benefit?

This question makes Monday's weekly US Department of Agriculture
crop progress report all the more important, in giving a take on recovery in
spring wheat after, last time, showing a 10-point fall to 45% rated "good" or "excellent".

Richard Feltes at RJ O'Brien forecast that next Monday's briefing
"will show modest gain in US had red spring wheat ratings… given known rains in
upper Great Plains."...MORE